Sumary of Govt plans law for lenders to pursue defaulters abroad:
- MUMBAI: The government has proposed changes to the bankruptcy legislation by adopting a global model law that will enable lenders to apply the insolvency law to defaulters’ assets lying overseas.
- The changes would also allow execution of orders against defaulters by overseas courts that have adopted the model law.
- The government has invited public comments on the proposed modifications by December 15. The comments can be sent only through a web link provided on the website of the Insolvency and Bankruptcy Board of India (IBBI).
- The model law is provided by the United Nations Commission on International Trade Law (UNCITRAL) — a subsidiary body of the UN.
- The model law lays down the basic framework for cooperation between domestic and foreign courts, and domestic and foreign insolvency professionals.
- It also provides a framework for the commencement of domestic insolvency proceedings when a foreign insolvency proceeding has already commenced, or vice versa.
- Among the bills proposed for the winter session of Parliament is an amendment to the Insolvency and Bankruptcy Code (IBC).